European Union energy ministers meet on Thursday to discuss energy security before the winter heating season, as wars in Iran, Ukraine and Yemen push oil and natural gas prices higher. Fighting has damaged refineries across the Middle East and Russia and disrupted oil and gas flows through shipping lanes in the Black Sea, the Red Sea and the Strait of Hormuz. European wholesale gas prices briefly touched €100 per megawatt-hour on Wednesday, the first time since December 2022, when Europe was still reeling from the loss of most Russian pipeline gas.

Ministers weigh affordability, not just supply

EU Energy Commissioner Dan Jorgensen warned on Wednesday that the situation was serious, saying: "We are in a very serious situation now." He argued that supply alone was not enough if households and businesses could not afford energy, and said affordability was just as urgent an issue. The European Commission began talks with European refineries on Wednesday on ways to raise output, including by possibly easing some technical specifications. Ministers will also discuss a proposal to cut electricity bills through tax and grid-fee reforms, such as taxing electricity at a lower rate than natural gas.

Storage shortfall adds to winter worry

Europe is entering the heating season with gas stocks at only about 75% of available storage, compared with 83% a year ago, according to the reporting of the meeting. Western powers also agreed this month to speed up the release of more than 400 million barrels of emergency oil stocks after pressure from the United States. Prices are now trading at around triple their levels before the Iran war, so the ministers' discussion matters well beyond Brussels: it will shape how far governments go to protect households and industry if cold weather or further disruption tightens supply again.

Sources: BusinessWorld, Reuters.